WASHINGTON (AP) ¿ Shares of Dycom Industries Inc. sank Wednesday after the telecommunications contractor offered lackluster revenue guidance for its fiscal first quarter.
Its stock shed $1.68, or 11.9 percent, to $12.50 in afternoon trading. The company's stock has traded between $3.64 and $17.13 over the last 52-week period, and is up nearly 73 percent since January.
The Palm Beach, Gardens, Fla.-based company said Wednesday during a conference call with analysts that it anticipates first-quarter revenue will come in flat to down sequentially. In the fourth quarter, the company booked revenue of $269.7 million. Analysts polled by Thomson Reuters are looking for higher revenue of $284.5 million.
FBR Capital Markets analyst Alex Rygiel said, "We continue to believe that investors will come back to the shares of Dycom Industries." He cited several reasons including improvement of the domestic economy, cash generation and stimulus funding for broadband deployment in underserved markets starts, among other factors.Rygiel says the stock is undervalued compared with its peers and raised the price target to $20 from $15, implying potential upside of 41 percent from its closing price Tuesday.